Google's perfect play

06-11-2008

by Ralph Averbuch

Just when you thought that things really couldn’t get a whole lot worse, Yahoo’s knight in shining armour, Google, appears to have decided that the regulator dragon’s just a bit too scary and it’s not up for the fight. News that Google has backed out of the advertising deal, intended to wrong-foot Microsoft’s attempt at a Yahoo takeover earlier this year, perhaps shouldn’t come as a surprise to anyone. Why would Google, which already dominates online advertising, really want to trouble itself with an ad deal which involves working with a direct competitor? It always seemed less than workable and now, at the slightest hint of regulatory resistance, Google uses this as pretense for calling off the deal. And so poor Yahoo, once the doyen of the digerati, is left with no suitor at all. Microsoft is most certainly uninterested in Yahoo now, only keen on picking off choice pieces that fit with its own plans. Meanwhile Google’s impeccable approach leaves it unharmed by this most recent turn of events, but the same can’t be said of Yahoo or Microsoft. Yet Yahoo’s management, going by their past track record, will perhaps be secretly relieved by this result. Its management can go back to doing their own thing, their own way, whether it’s good for shareholders or not.